Circular No .431/64/98-CX dated 19/11/1998
Subject: Catalysts of precious metals falling under Chapter 71 - scope of
exemption in notification No. 05/98-C.E.
I am directed to state that representations have been received from the trade,
retarding the scope of exemption available to previous, metals and articles of
precious metals such as ingots, bars, crucibles, foils, dishes, wires, wire gauges
etc., under SI. No. 193 or 194 of Notification No. 05/98-C.E. dated 2.6.98. lt has
been represented that the benefit of exemption under SI. no. 193 or 194 of
Notification No. 05/98-CE dated 2.6.98 is being denied on the ground that the above
goods of precious metals when re-made, re-conditioned, re-fabricated etc., and used
as catalysts, are subject to excise duty at the rate of 18% of the value of
materials, if any added and the amount charged for such manufacture under SI. No. 36
of the same notification. References have also been received from some field
formations in this regard.
2. The matter has been examined. While articles of precious metals falling under
Chapter 71 are subject to Nil rate of duty under SI. No. 193, the precious metals in
unfinished and semi- finished forms are subject to Nil rate of excise-duty under SI.
No. 194 of notification No. 05/98-C.E. dated 2.6.98. The above exemption is
unconditional and is applicable to the said goods irrespective of whether they are
manufactured first time or re-made, re-conditioned or refabricated. Accordingly, it
will be incorrect to charge duty on such goods under SI. No. 36 of the same
notification.
3. As per the HSN explanatory notes, catalyses in the form of wire cloth or grill, of
platinum, iridium, osmium, palladium are covered under Chapter Heading 7101.90 of the
central excise tariff, as ""Other articles of precious metals"". Only amalgams of
precious metals and colloidal precious metals (Chapter 28) and supported catalysts
(Chapter 38) are excluded from Chapter 71 as per the chapter notes. Hence catalysts
and articles of precious metals falling under Chapter 71 are distiretly identified
from the catalysts of Chapter 28 or 38.
4. Accordingly, it is clarified that the exemption from excise duty under SI. No. 193
and 194 of Notification No. 05/98-C.E. shall not be denied to goods of precious metals
such as catalysts, ingots, powder and sponge falling under Chapter 71 when re-made out
of used or spent catalysts of such precious metals, re-conditioned or re-fabricated or
re-covered from old or used articles of precious metals or subjected to any other
similar process. In order to remove any doubts in this regard the entry at SI. No. 36
of Notification No. U5/98-C.E. has also been amended suitably vide Notification No.
34/.98-C.E. dated 10.11.98.
Sd/-
(P.R. Chandrasekharan)
Director (TRD)
F.No. 332/82/98.TRU
Presented by eximkey.com